Policy

The “Future” Party

Dave Davis Commentary, Policy, The Future Party, Uncategorized

The funeral of Barbara Bush, the matriarch of a preeminent Republican family illuminates just how broken things are.  While former Presidents of both parties attended there was a notable no-show, the present Republican President Donald Trump.  Now sitting presidents don’t always go to first lady funerals, but who wouldn’t want to be seen paying his respects to “America’s Grandmother,” especially a publicity addict like Trump. He didn’t go simply because he wouldn’t  have been welcome.  Think about it.  The leader of the Republican Party wasn’t welcome at the funeral of the wife of one Republican president and the mother of another.  If this doesn’t alert the nation to a major split in one of our two major parties nothing will.  In fact, most of the Republican attendees must feel they no longer have a party.  Rolling over for the present President would mean surrendering their values.  According to recent polls, they are a minority in their party, with the President viewed favorably by at least 70-80% of Republicans.   As the Senator  from Arizona, Jeff Flake, found there is no  room for those old Goldwater-Reagan people in the present party.

A move to the other major party offers no welcoming home either.  If you’re a free market Republican strongly favoring trade agreements such as the Trans Pacific  Partnership (TPP) you might find kindred souls among the Democrats. After all, it was negotiated by the then Secretary of State Hillary Clinton under the Obama administration.  Surely on this issue at least these Republicans could join with Democrats.   This would be way off base.  To placate the dominant progressive wing of that party, Clinton simply ran away from her own handiwork.  Bernie Sanders and the progressives didn’t want any part of TPP so she caved.  Odd, the dominant Trump wing of the Republicans had exactly the same position on TPP as the dominant progressive wing of the Democrats. On closer inspection this isn’t odd at all .  On major issues these supposed blood rivals are in basic agreement or have symbiotic relationship. Continue reading →

China

Dave Davis Policy, Uncategorized

If the Russian situation isn’t enough to keep you up at night, our “policy” in the Far East should do the job.  North Korea threatens us with nuclear tipped missiles it hasn’t quite perfected  and we agree to a summit that can do nothing but enhance the prestige of that country’s dictator.  We are counting on China. to apply pressure on the  North Korean Dictator Kim to give up his Nuclear weapon systems, at the same time we are on the verge of a trade war with them over their predatory trade policies. Seems China is in a fortuitous of position to get a pass on trade if they help us on North Korea.  How did China get in this position and we ended up on the horns of the dilemma?

Now, North Korea is a Chinese Satellite much the same as Belarus is to Russia.  Both look to their masters before taking any action. What if Belarus President Alexander Lukashenko was determined to undertake a nuclear program to threaten its NATO neighbors especially Poland, Lithuania and Latvia. Would our President meet with him to get him to give up his program? Of course Putin would  offer to mediate the problem if we would remove our sanctions on Russia for his good offices. One would like to think we wouldn’t fall for this and would properly hold the puppet master Putin responsible . and go right after him.

Yet this is the same as our East Asia Dilemma. If Kim didn’t know his master he wouldn’t have been on the next train to Beijing when Xi whistled. Don’t be fooled with the reports China has been taken aback by North Korean actions.  If China didn’t want North Korea to have Nuclear missiles it would never happen. Kim would get the message and stop the program or he would be gone and someone more obedient would take his place  After all China is the only country providing anything of value to North Korea. There would be no collapse sending millions of starving Koreans into China, just a quiet military coup.  Those that have profited so handsomely from  North Korean Stalinism only have to be assured of their positions with the new boss. So why doesn’t China make the move?  Simply because this situation serves China’s purpose.  Think about it. China threatens major trade routes counter to our and our allies interests. They steal our and other’s intellectual property along with other unfair trade practices.  Without the North Korean situation, we would be taking a much more adversarial attitude towards China. Yes we’ve threatened put on some tariffs but those will probably go in payment for any help China gives in halting the North Korean Nuclear program.  You just can’t punish someone when you’re simultaneously begging for their help.  China has us just where they want us.

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Criminal Minds

Dave Davis Commentary, Policy, Uncategorized

Another mass murder resulting  the usual running off in all directions.  Ban the type of weapon used.  No fortify and arm the schools. Someone dropped the ball.  What we seem to overlook is normal people don’t commit mass murderer.  Abnormal people do.  Further, in most cases the perpetrators have exhibited behaviors that gave us clear indications they were capable of acts most wouldn’t even entertain.  What we don’t have is a method to connect the dots necessary to prevent them from acting.  Millions of people watch “Criminal Minds” a TV series that follows a team of FBI profilers tracking down people who commit horrific crimes.  The idea is to use characteristics to create a profile of the criminal in order to make an identification.  In other words, mass murders have a different set of traits that set them apart from the general populace.  Indeed, if you went to the FBI and asked them for a general profile of those capable of mass murder they could provide it. What is needed is a way to reverse the procedure of using the profile to catch the bad guys after the committing of crimes to a way to fill in the profile before the crimes take place.

The FBI with a comprehensive profile based on the idiosyncrasies of mass murderers refined and combined with a super data collection system would give us the basis to identify them before they act.  We already have tip lines but these would be far more effective with a questionnaire filling in the blanks on a profile.  Extended to the internet, someone who sees abnormal behavior such as cruelty to animals could log on to the FBI tip site and find the questionnaire to be filled out. A person conflicted by what they had observed would see cruelty to animals is something needed to be reported.  The questionnaire could alert observers to the kinds of behavior we need to know about.  At the same time they would be assured the information provided would be correlated with other reports. This is where big data comes in.  With the proper algorithms all reports would be in one place to be aggregated and ranked.

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Surrounded

Dave Davis Commentary, Policy, Uncategorized

With all the Trump White House News dominating each and every news cycle, it has been widely overlooked the US backed coalition in Northern Syria repelled an attack by Assad government forces.  Over 100 of the Assad forces possibly including Russians were killed. There were no coalition losses.  This group, the Syrian Democratic Forces (SDF), is made up of 2000 US troops working with Kurdish and Arab militias.   The Assad forces are an alliance of other Syrians, Hezbollah and Iran with Russian support.  It’s well-recognized the Kurds are the backbone of this US led coalition that took the Issis Capitol Raqqa.  The Trump Administration has loudly claimed victory over Issis with this success.  The coalition is still battling Issis remnants and other extremists groups in Northern Syria to keep them from reconstituting.  To further complicate the situation, Turkey on Syria’s northern border with Russian acquiescence is attacking Kurdish forces in the Northwest Syria Afrin enclave and threatening the Kurdish elements of the coalition.  One has to ask, how did our troops end up surrounded by threats, what are we hoping to accomplish and do we really have a workable middle east plan?

The pro Assad alliance in Syria is basically a Shia Army hell-bent on reconquering the majority Sunni Country by any means possible including  chemical weapons.  Remember those were supposed to removed from Syria by the Russians.  No wonder refugees have moved into coalition held areas. So in addition to preventing a resurgence of extremists, the coalition is trying to keep  the Syrian tragedy from getting even worse. This is nothing new for the Kurds.  When so much of Iraq including Mosul fell to Issis, many of those fleeing this horror found refuge behind the guns of the Kurdish Peshmerga.  It’s hard to visualize the recapture of Mosul without Kurdish support. Both in fighting ISiS and our humanitarian efforts the Kurds have been our best ally.  In theory Turkey is our NATO ally.  Under Pres. Erdogaon this almost daily proves to be less true.  An Islamist, he has moved his nation closer to Iran and Russia and away from the West.  In Turkey there is a large  Kurdish  concentration  in the Southeast part of the country, along the Syrian border.  Turkish mistreatment of these Kurds has a long history and Erdegon  has if anything made things worse.  A successful Kurdish uprising is his worst nightmare. He might have treated the Kurds right, but that ship has sailed. Turkey like the Assad Alliance feels the need to crush the Kurdish areas along the Syrian border as a matter of survival

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Simple Interest

Dave Davis Commentary, Policy, The Long Journey to "More", Uncategorized

In our 1/2/18 post “2018” we suggested that the only group that could supply new funds to push the stock market higher was the public at large.  The figures for December and January are in they show this group’s participation was the greatest since the “Great Recession.” They bought pushing the market to the stratosphere. Unfortunately, with no more new money available, the market was set up for a change of direction.  The reason given for the subsequent sharp down move was rising interest rates.  The bulls argue the market hadn’t had a correction for an abnormally long time and was overdue. In any case interest rates are historically low. Even the recent rise and the projected Federal Reserve moves should be easily handled by worldwide growth. After all, economic expansions in the past faced much higher rates and still thrived.  In the US profits will be greatly enhanced by the recent tax revisions.  Wages and optimism are rising.  Solid reasons for expecting the economic expansion to continue accompanied by rising profits.  This should be reflected in higher stock prices.

On the surface this makes a lot of sense but what if the recent interest rate rise even from such low levels is indicative of a much more dangerous situation?  In our series the Long Journey to “More” the post Free Capital to Finance “More”  attempted to show how the world’s central banks led by our Federal Reserve had caused massive distortions to the traditional risk pyramid.  Instead of a base of relatively safe assets tapering up to high risk, we had a pyramid of mostly risky assets.  With so much risk already, investors might really be reluctant to go after the really high risk/high reward ventures.  We thought this might help explain the tepid growth throughout the era worldwide “Quantitative Easing.”  The theory behind the central bankers move to zero or negative interest rates was to drive up the value of risk assets giving their owners gains resulting in a “wealth effect.” This would result rise in greater consumption driving growth.  Some economists claim this indeed added to growing  GDPs.  The consensus in the US is that it added about 1/2% to our GDP.  Even granting this might be true, it has left investors far and wide with horribly unbalanced portfolios.  Across the board they’re out of line with normal risk tolerance.

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